The current financial and economic crisis: empirical and methodological issues

In this paper we describe the main causes of the recent financial crisis as a result of many theoretical, methodological, and practical shortcomings mostly according to heterodox, but also including some important orthodox economists. At theoretical level, there are problems concerning teaching and using economic models with overly unrealistic assumptions. In the methodological front, we find the unsuspected shadow of Milton Friedman’s ‘unrealisticism of assumptions’ thesis lurking behind the construction of this kind of models and the widespread neglect of methodological issues. Of course, the most evident shortcomings are at the practical level: (i) huge interests of the participants in the financial markets (banks, central bankers, regulators, rating agencies mortgage brokers, politicians, governments, executives, economists, etc. mainly in the US, Canada and Europe, but also in Japan and the rest of the world), (ii) in an almost completely free financial and economic market, that is, one (almost) without any regulation or supervision, (iii) decision-taking upon some not well regarded qualities, like irresponsibility, ignorance, and inertia; and (iv) difficulties to understand the current crisis as well as some biases directing economic rescues by governments. Following many others, we propose that we take this episode as an opportunity to reflect on, and hopefully redirect, economic theory and practice.

A questão do desenvolvimento à luz da globalização da economia capitalista

Cet article cherche à dresser, sous la perspective historique, le bilan de la situation des pays périphériques dans les dernières trentes années. Pour cela, il aborde particulièrement les enjeux du développement dans la phase de la globalisation du capital. Ce travail s'appuie surtout sur les études de la vaste bibliographie publiée récemment. Dans quelle mesure la relance du développement concernant plusieurs secteurs stagnés de la périphérie deviendrait-elle une réelle possibilité? Autour de cette question, que nous trouvons centrale dans l'actuelle conjoncture, nous entamons quelques réflexions. Nous envisageons montrer que la stagnation économique à laquelle des nombreux pays non développés font face ne découle pas en partie d'une crise sociale et économique ouverte dans les années soixante-dix et qui s'élargit jusqu'à nos jours malgré les tentatives de restructuration de la société capitaliste. Les stratégies et les mesures politiques à caractère néo-liberal aussi auraient énormément contribué à cette situation étant donné qu'elles ont renforcé les amarres financières qui ont étranglé pour une part les économies périphériques. Outre ces difficultés, ces pays affronteraient les limites écologiques du capitalisme. La relance du développement dans un nouveau stade exigeant la croissance économique, la justice sociale et la préservation de la nature amènerait à une rupture face au capitalisme.

Desenvolvimento econômico e desigualdade social: um estudo sobre os aspectos sociais presentes na obra de Raúl Prebisch

This study aims to conduct an analysis on the social aspects present in the works of the Argentine economist Raúl Prebisch (1901-1986). Based on the author's research on the economic development of the peripheral countries, it will be demonstrated how the social and economic factors have interconnected in the developmental theory of the peripheral worldwide economy. To achieve this goal, the six works of Prebisch considered essentials by Economic Commission for Latin America and the Caribbean (ECLAC) were used as main bibliographic axis. Such texts are: Introduction to Keynes, The Economic Development of Latin America and Its Principal Problems, Economic development or monetary stability: the false dilemma, Towards a Dynamic Development Policy for Latin America, .Change and Development: Latin America's Great Task, Capitalismo periférico: crisis y transformación, Five stages in my thinking on development. Firstly the topics essential to economic development according to the author will be exposed, such as industrialization of peripheral countries as a means of raising the income of masses and the way it should be coordinated beyond the theoretical author's choice on historical events, the evolution of the deterioration of terms of trade between peripheral and central countries and the need for productivity gains to increase the income of the worker. Afterwards it will be exposed how such terms align with social inequalities and which definitions are incorporated by the author on the subject